Your Insights on Cross-Border Shopping

February 12th, 2013

A large majority of Lower Mainland and Fraser Valley residents are making driving trips to the US (74% in the past 12 months), and this trend is apparently increasing (21% go more often now than 12 months ago whereas only 12% go less often). Superior US retail pricing is the number-one reason to cross the border (85%).

Vancouver, BC – A recent Insights West online poll surveyed 1,077 Metro Vancouver and Fraser Valley adults regarding cross-border trips and shopping in the US and found that not only are a large majority of local residents making the drive (74% took one or more trips in the past 12 months), many are making trips on a frequent basis. On average, 5.2 trips were taken in the past 12 months (with 3.0 being the median, or most usual number). Approximately half of adult residents (49%) crossed the border three or more times with a sizeable minority (15%) making the drive an incredible 13 or more times!

There is also evidence that crossing the border into the US is becomingly increasingly common. While 66% report their behaviour to be unchanged compared to 12 months ago, one-in-five (21%) tell us they are driving more often now whereas only 12% are driving less often (the remaining 1% are unsure).

Once in the US, purchasing habits are fairly diverse. Among the 772 respondents who drive to the US in a typical year, we find that purchase of gas (95% buy, 69% regularly), groceries (91%, 49% regularly) and clothing/ shoes/ accessories (94% buy, 35% regularly) are almost universal. Purchases of larger ticket items are less common, but still bought by a fair number; 60% buy electronics/ computers and 22% furniture.

But many travellers are also going to the US and spending money on leisure activities – not just dining out (93%, 42% regularly) and accommodation (85%, 19% regularly), but also entertainment in general (75%, 11% regularly) and casino gambling in particular (41%, 7% regularly).

So what motivates so many of us travelling to the US to spend our hard earned dollars instead of keeping our money in the BC economy? Of the 13 different reasons presented as part of the survey, the one that received the most resounding level of agreement is related to prices! Nine-in-ten (85%) who drive to the US in a typical year indicate that lower prices for the same or similar products in the US is a reason for travel, with 61% indicating it is a very important reason. The strong Canadian dollar provides an added incentive (84% tell us it is an important reason, 49% very important) as does the recently (June 2012) relaxed duty free rules (69% important, 35% very important).

“Metro Vancouver and Fraser Valley shoppers are very conscious that retail prices in the US are often better than in Canada,” comments Catherine Dawson, Senior Vice President with Insights West. In support of this, an overwhelming majority agrees (91%, with 60% strongly and 31% somewhat) that Canadian retail prices need to improve if this cross-border shopping behaviour is to change.

And it seems that online purchases from US sites aren’t going to replace all of Metro Vancouver/ Fraser Valley shoppers’ driving trips. Many who travel in an average year believe it is cheaper to drive to the US than it is to pay shipping for the products online from US websites (55% site it as an important reason they make the trip, 27% very important). Additionally, only a minority of residents agree with the statement “With everything available online, I don’t know why Canadians bother to travel to the US to shop” (37% agree, 9% strongly).

But what about the impact on the Canadian economy and jobs? While this is relevant to local residents, the same degree of concern is not seen here as with inequity on pricing. While a large majority agree that cross-border shopping is hurting our economy (70%), only one-in-four hold this opinion strongly (25% agree strongly whereas 45% agree somewhat). Further, only about half agree that the behaviour is costing Canadians jobs (51% agree, 15% strongly).

“These opinions suggest that local residents are a more concerned with their own finances and getting a good deal when they shop than they are with how their behaviour might be impacting the broader Canadian economy and population,” Dawson notes.

About Insights West:

Insights West is a progressive, Western-based, full-service marketing research company. It exists to serve the market with insights-driven research solutions and interpretive analysis, through leading-edge tools, normative databases, and senior-level expertise across a broad range of public and private sector organizations. Insights West is based in Vancouver and Calgary, and has seven full-time, and five part-time employees.

Results are based on an online study conducted January 30th – February 3rd, 2013, among 1,077 residents of Metro Vancouver and the Fraser Valley aged 18+ who are Your Insights panel members. YourInsights.ca is Insights West’s in-house access panel offering on-demand samples for both clients and research suppliers looking for Western Canadian populations. The data has been statistically weighted according to Canadian census figures for BC for age and gender. While statistical margins of error are arguably not applicable to online panels/online studies of this nature, we have assumed that the same margins of error apply as if it were a true unweighted random probability sample with a margin of error of +/- 3.0 percentage points, nineteen times out of twenty. To view the detailed data tabulations, click here.